Rory Sutherland, Vice Chairman of Ogilvy UK, talks to Eric and DuBose about everything from payment models to selling a bacon sandwich. A true legend in the world of advertising, Rory’s latest book is Alchemy: The Magic of Original Thinking in a World of Mind-Numbing Conformity.
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Transcript
Roy: Things that are slightly nonsensical, things that we don't expect, things that don't seem entirely logical do have the strange compensating advantage of garnering a lot of our attention.
Eric: I'm Eric Fulwiler, and this is Scratch Bringing You Marketing lessons from the leading brands and brains rewriting the rule book from scratch for the world of today.
All right, our guest today because I'm joined by my co-founder and co-host now DuBose for this episode, our guest today is literally the one and only. Yeah, you could say that for a lot of people. Rory is a one and only Rory Sutherland, who has been at Ogilvy for 34 years as a creative director and also as vice chairman for the last 17 years. Rory is a Ted global speaker and the author of Alchemy, the Surprising Power of Ideas that Don't make sense. Rory knows so much. He like, oh my God, he's a walking encyclopedia of marketing, advertising innovation. I mean, we touched on so many fascinating things in this conversation. Dubbos, what were some of the highlights for you?
DuBose: It's hard to summarize everywhere we went with this conversation, but Rory is a fault of information and had amazing views on everything from behavior change and how the pandemic has changed consumer behavior through to his favorite brands, through to how advertising needs to change and marketing needs to change to go further, developing collaborative knowledge bases and providing more value, moving beyond kind of billing by the hour to bring in more proactive thinking. And then finally, such amazing things is why a bacon sandwich restaurant would disrupt the entire London restaurant scene.
Eric: I will say one of the things he knows a lot about is food and if you are hungry might be best to come back to this episode later. So without further ado, please enjoy our episode with Rory Sutherland. Hey Rory, how are you? Thanks so much for joining us.
Rory: Ah, it's a huge pleasure. Thank you very much for inviting me on
Eric: And DuBose, good to see you haven't talked to you in five minutes.
DuBose: Indeed. It's always good to catch up another time in the day.
Eric: I like you rocking the rival swag. It's good to see. All right, let's get into it. I mean we were saying, well first of all it's eight minutes past the hour. We had eight minutes of really interesting thoughts from you already. Rory. I wish we could have recorded that. Maybe we'll have to recover some of that ground. But I was saying before we press record, I'd be surprised if we get through one or two questions because I know that there's so many things that the three of us could talk about that could easily take up 40 minutes. But let's get into it with kind of the standard question that we use. I'm very curious to hear your thoughts on a brand that you're very passionate, curious, interested in right now.
Rory: One brand that struck me as very, very interesting is a brand that's new in the UK called DishPatch and I'm always very interested in innovation in the food space, the quick service restaurant space because two areas I think which are always quite ripe for experimentation in behavioral science, our transportation about which I've one recent book and also I find the restaurant food space very interesting partly because Covid seems to have launched a kind of Cambrian explosion of innovation in that particular space and dispatch effectively takes pretty good or very good actually London restaurants and they prepare the food chilled and ship it all over the country. So it's restaurant food delivered to your home for I suppose reheating in some cases and plating up in preparation. So the only part you have to do yourself is what you might call the last part. And in many ways when you dig back on it, it makes more sense in a way than takeaway food does.
The business of delivering food, Luke warm seems to me always a bit silly on the grounds that I don't have any shortage of facilities to heat food at home. If there's one thing I'm short of, it's culinary talent. It's not the ability to warm things up. I've got air fryers, ovens got frying pans, whatever else, and I've enjoyed dispatch because it's one of those things which you have to try it to appreciate it and I think that's actually true of very many innovations. I think that now obviously as an advertising guy, I should claim that we are capable, our communication skills are such that we can always actually deliver the promise of a new product or technology to people simply through our share communications talent. But I do think there are products which in a way appeal to the unconscious but not to the conscious in some way where there's no substitute for experience.
And both Gusto, which is a food kit delivery firm with which we've done a little bit of work actually of which I'm a pretty loyal customer and also DishPatch strike me as very interesting. And the third thing that interests me is the whole business of dark kitchens. So the whole business where a lot of innovation isn't about assembling things, it's actually dissembling things. So the restaurant is a full service restaurant, but what we see now is, which is a chain of restaurants in London, I think Manchester, a few other cities in Britain also has a dark kitchen in Brighton, which means that you can order it through Deliveroo, but there's no restaurant as such. Maybe they plan to open a restaurant later. I don't know, maybe they couldn't find the real estate, but it's a very, very interesting development as is the very interesting development of meal kits because of course it's worth noting there are a lot of restaurants I love that have one location often in London it's difficult to get to.
One of them is Roti King. I don't know if anybody remembers this. It's near Houston Station and if your dev of Malaysian food and Roti, there's nowhere to touch it. Now realistically, it's only about once every six to eight weeks I can get anywhere near the place and then there's a massive cube because it's so popular. But the ability to have Roti King food delivered for reheating to my home has been pretty transformational I have to say. So I love those areas where you probably have enormous amount of traditionalism, which then just gets completely disrupted by the pandemic. So innovations that would've taken 10 years to happen more or less happen in the space of 18 months. That's been fascinating.
Eric: Well the thing that makes me think of is a lot of innovation comes from re-imagining things from scratch for the world of today, which is the reason that this podcast is named what it is. And so you could say that traditional takeaway is just kind of almost in a way, especially like a Deliveroo or delivery hero or one of those, it's just kind of digitizing what is an analog experience. You cook a meal in a restaurant and then through an app you're able to deliver it at home, whereas what you're talking about, they're actually re-imagining things for the world of today. Forget the assumptions of what we knew before
Rory: It occurred to me because most of these restaurants tend to deliver their signature dish. They don't deliver the whole menu and they only deliver either once or twice a week. There's another great one called UB Chef, which is a michelan starred restaurant on the Isle of White. Because of that, there's probably considerable batch processing efficiencies in that getting a chef and a team to produce 2000 ROEs, 2000 chicken curries is probably an order of magnitude less effort than having to do it one customer at a time. So that was actually Chairman Mao's, great thing. Chairman Mao believed people should eat commonly because it required less energy to eat heat a large pot than to eat, than to eat 10 small pots because the surface area as a proportion of volume was lower. And so Mao had this peculiar obsession with common eating. I don't imagine Mao's China was great if you had an allergy or an intolerance, I have to say, okay no, you will eat what the rest of village number 2,427 is eating. I don't care the fact if you're going to be projectile vomiting all night. So it wasn't great for picky eaters mach China but on the other hand, there is room for actually the batch efficiency of high quality food production which probably is underexplored. In other words, we've tended to combine high quality food with individual preparation and actually high quality food with four dis efficiencies upstream is probably quite an opportunity now
DuBose: It's such an interesting point you raised there though. I guess there's the idea of individual preparation and quality tied together in a consumer's mind. Do you think if you start to make it a bit more communal, it chips away at the overall perception of the value of what they're getting?
Rory: So that's an interesting question, which is whether the knowledge of the fact that the thing has been prepared at scale diminishes the enjoyment is an interesting question. My hunch is because it's consumed in isolation, you probably don't get that effect. It's worth noting of course that some of the greatest restaurants in the world there are a couple in California only have one menu. So you basically turn up there are very, very fine restaurants, which effectively, I think it's the French laundry, is it somewhere? There are a few places in California where you turn up Alice, what's her names? Restaurant was like that you turned up and you had whatever she wanted to serve you that day. There was no question of substitutions, <laugh>, something like that. And so I think you can get away with it because some people would argue, I think that actually the very highest quality food would actually profit from division of labor in that way. It's true If you're making a hundred of something and you mess up three of them, you throw the three away. Whereas if you're making one of something and you mess it up, you probably try and cobble it together on the plate.
DuBose: It's true. There's probably something about reframing an efficiency of scale as oze and then suddenly you're much more willing to pay for it.
Rory: Beautifully done. That's a lovely thought. I mean other areas that interest me, by the way, electric cars interest me a lot because I see the obstacles to electric car adoption now as being when they aren't economic, they're largely psychological. And what's been interesting to me about that is that range anxiety is a perfectly relevant and indeed intelligent fear in the United States or Canada in the UK or the Netherlands for example, densely populated countries. I can, I always reel off the same nine reasons, but I think it's about nine. We've got 240 volts domestic power. So if you go and visit your grandmother and plug in overnight, you'll still get 70 miles a range, which is enough to get you to the nearest rapid charger. If you've got a very long drive you have to undertake in one day there and back, we probably take the train. Americans mostly can't do that. There's very little wilderness in the uk, very rare incidence of extremely low temperatures, which of course novel the range electric cars, if you're in kind of Idaho in the deep depth of winter, your range is going to go down about 30 40% and your charging speed and capacity will fall. Densely dense population means that actually being dependent on one charger to complete your journey with no other alternative, very different matter. Also, there's a difference between breaking your journey in borton and the water, going to a T rooms and having some scones while your car is charging versus spending two hours in sub-zero temperatures at a Nebraska truck stop. When you just hear that a serial killers escaped from the local federal penitentiary. Those are different experiences. The likelihood in the UK that you can actually find something to do to the time while you're charging is fundamentally different. We've got lots of small towns all over the bloody place. I completely understand why someone effectively driving through the New Mexico desert or something would feel anxious about range. To be honest. In Britain we've inherited the fear. It's not really all that pertinent and in fact as a result we are probably getting bigger batteries than we need, making the cars more expensive than they need to be in many cases.
Eric: So Roy, I'm curious to, we got a couple notes in here about your book, about some talks you've done recently, but actually I think I might just ask you what is kind of the state of Rory Sutherland's perspective on the marketing industry right now? Maybe we start there at the highest level and then let's drill down into some of the things that I know you are passionate about.
Rory: One thing is I think it's quite badly broken. I think payment by the hour has lasted so long as to create significant distortions in the way that marketing services are delivered. A system like that probably doesn't matter at first, but eventually you become over-optimized around your financial incentives and I think at some level I would see Zoom as an opportunity to reinvent the delivery of marketing services sometimes in a one to many model. By the way, one of the limitations of growth and profit for the advertising industry is that we effectively solve once, sell once if we're lucky, if we're unlucky it solve once fail to sell now actually solve once sell many times has to be a more lucrative potential model. And I think with the very technology we're using now with what you might call B2B broadcasting, I think the potential for that is much, much greater. We noticed with events like Nudge stock 10th of June this year, by the way, if anybody wants to block it in their diaries, we've got an online audience of 40, 50, 60, up to a hundred thousand people. And so it's crazy not to take advantage of scale effects like that when they're possible. And so I also think that there is still a strong muscle memory in the advertising industry, which is that if you don't produce a communication, you haven't done your job. And one of the things I was very eager with behavioral science is I saw behavioral science as being a way to deploy the magical value creation properties of marketing and creative thinking for companies that don't necessarily have a huge media budget, we're still overly optimized around those parts of the business that spend money on media despite the fact that we haven't been paid on commission since about 1992. So I think there is scope actually for significant reinvention in this market, particularly post pandemic where a lot of the norms of business interaction have been disrupted for good. We used to be a handshaking business, maybe now we're a broadcasting business. Maybe one of the reasons people say Why are you doing this pod? Why are you doing these podcast Rory? And I go, because speaking to 500 people at a time is more efficient than speaking to one person at a time and you never know you might get lucky. And so I think ultimately my belief in our ability to create value is completely undiminished quite the opposite in fact. But our ability to make money while adding value, I'm not so confident in, I have to say, and I think I was using an analogy earlier on a torque where I talked about if you are optimized around one or two dimensions, typically numerical dimensions like payment by the hour and cost per the hour, I mean first of all you've been commoditized so you're in that dreadful death spiral of cost reduction, which doesn't really incentivize you to create value to the extent that you could. But secondly, I always said it's a bit like the difference between a working dog and a show dog. The working dog has been chosen and selected over generations by someone who wants the dog to perform a function and it judges the dog by how good it is at what it's there for. Okay, it's a kind of what you might call multifaceted form of appraisal and if you look at working dogs, the border Collier is probably the finest example. I don't know if you're dog people at all, but dogs that are descended from working dogs tend to be pretty healthy, pretty fit, pretty intelligent, everything else. The dogs that have been optimized for show conditions, the pug of the world where it's all about huge ears, small legs, tiny nose, short tail, okay, those dogs that have been bred for what you might call three or four proxy dimensions of desirability, it's fine for the first couple of generations doesn't do any harm at all. But over about five or 10 generations you start to get sickness, deformity, illness, and I think you know might argue that the advertising industry has had payment by the hour for so long. Now it's starting to develop pug like characteristics.
Eric: So Rory, what is the fix for and the billing by the hour problem that we have in our industry,
Rory: It's in defense of people who go here. Of course it's all about, it's very difficult to come up with alternatives because you can't entirely come up with payment by results in the sense that one, if you did something that was spectacularly successful, you'd probably create an unbelievable problem if your payment was absolutely pro ratta for the value you created. But there are also reasons where you might do a lot of work only for the work not to actually happen for reasons beyond your control. And that was always the curse of advertising beforehand. You developed some fantastic campaign entirely unpaid on the expectation of a lot of media spend and then their factory would burn down in some disastrous fire and you'd never get any money and that was always the thing that beset people who in the age of commission, which was, it was more rewarding probably overall, but there were some cases of effectively catastrophe entirely beyond your control. The only thing I would say is that it probably has payment by the hour has meant that there are too many account people and too few creative people generally because it's easier to sell people who report directly to one client than people who may be actually cross client. I think it's distorted the relative numbers in the advertising industry and I think it's also probably made us less proactive. I think that under commission, if you could think up an idea which involved extra work but opportunity, there was a big incentive to actually go and effectively suggest ideas, solutions and so forth. And I think we've become a little bit reactive and probably to be honest psychologically also a little bit too deferential as well. I think we've lost a little bit of our swagger because now it's no longer these guys make money from the media and they agree to work with us.
It's kind of dance for me monkey boy. It's a fundamentally different dynamic in the relationship as well. I mean it's mixed. I don't have the solution. I do think there is an interesting solution which is in probably somewhere between the agency and the event space in getting a mixture of people together to work on a problem. I think the hackathon model incredibly bright person who's just left V C C P as a planner who's called Amelia Tur, I noticed that her new agency effectively they discovered that the thing the clients really valued was the hackathon model. And by the way, there's a big advantage to the hackathon model I think, which is that you can bring people in who are not only marketers, you can bring in people from operations, you can bring in people from finance, you can bring in people from new product development into a hackathon and you can create something much more multidisciplinary and it's problem solving.
When I was a creative director in Ogilvy me, the direct or Ogilvy one as it then was I had a rule and I said it, it's a terribly pessimistic rule, but quite often creative teams would come up with a brilliant solution to a problem, but it wasn't a pure pay and play communication solution. It involved changing the pricing, changing the distribution, doing something outside the realm of mainstream Marcos. Horrible phrase, but I used it anyway and I always have the rule, which is that if any idea you have requires someone in marketing to phone up someone outside marketing, that idea will never happen. Now the hackathon might be a way to actually preempt that problem by having those people in from different disciplines at the beginning. Very interesting Tesco, I learned from Tesco that whenever they have any kind of brainstorming, it is mandatory I think in a Tesco brainstorm of any size that you have two store managers and the idea is that store managers are kind of in charge of everything and they can make things happen and they can also tell you when things can't happen because they understand the practicalities of everything.
And I thought that was a very smart thing from Tesco. You have to have these two store managers who have to come in and both provide you with sanity, which is not a bad thing, a hackathon, otherwise you tend to get into sort of delusional territory. But they can also, if they like an idea, they just go, well, okay, I'm going to try that in my store. I think there was a brilliant one which was an idea about changing the labeling so that when you mark down sandwiches you only had to stick the new price label on once rather than twice. That was one of the ideas that emerged from one of those things because I think the barcode was on a separate, the barcode might have been on the hypo news and the price label might have been on the baseline. And so every time you change the price of a sandwich, you had to cover up both.
DuBose: I think, it's such an interesting point you raised there about the implementation of the ideas, often holding ideas back. I guess one of the things I'd be curious to know a bit more about as well is I think is marketing holding itself back sometimes from scaling based on the idea of approaching every problem fresh. I think one of the things I think you've spoken about before as well is the ability to stand on the shoulder of experience, the idea of collective knowledge within the industry. You look at something like law or something like medicine and there's a real understanding that the things that have come before can help to inform new solutions. Well
Rory: That's my major hope for behavioral science because by codifying findings and by finding recurring patterns it makes it much, much. We do a thing in the behavioral science practice here called lateral category analysis and it's based on a kind of slightly, the insight from tr, which is your problem has probably already been solved, it's just been solved in a category different to your own. And so one of the things we try and do is we try and codify clever ideas. Now, an interesting example which was basically waiting to be had just as every time I meet anybody from a large multinational food and beverage I ask them why has nobody done the espresso of tea? Because it seems to be such a screamingly obvious category crying out for innovation, just that I always ask that I spent a few years going, I couldn't understand why so few people now Tesco has now done it with club card plus, but so few people copy that Amazon Prime model, which is you make a commitment, it costs you money, but in return you will get recurring savings which increase with the extent of your loyalty and frequency of purchase. Okay. Now actually without Amazon Prime, Amazon probably wouldn't have any super frequent customers because whereas 10 people don't mind paying for delivery once a month, one person isn't going to pay for delivery 10 times a month. But it always struck me that the Amazon Prime model was one which almost anybody could adopt. Your airlines could actually EasyJet did, but that was partly me. So I was the co-inventor of a thing called EasyJet plus where you paid about 80 pounds a year and it meant that when you flew, you tended to get the upfront seating and was it a bit of baggage loud so about I think you've got speedy boarding and upfront seating route every time for free. So it was a kind of Amazon prime freezy jet. But it's surprising to me how few people have attempted to replicate that, I have to say because it strikes me as a very clear pattern. How it works is patently say Claire, and that strikes me as odd. And so I think one of the great things about behavioral science is by codifying data only gives you the what? Behavioral science gives you the why and if you know why, you can see recurring patterns in human behavior and preference and so forth. And what enables you to do is to enjoy that efficiency of redeploying an idea from one place to somewhere else. And I don't think advertising which was overly focused on the brand level of decision making, not that brands aren't important, but they're not the only game in town. Brands are hugely important, but nonetheless, not every problem is a brand problem necessarily. It could be a channel problem or whatever. Okay, so I think there's something really important there, which is that the ability to effectively stand on the shoulders of giants if you like, or to build on past experience, I think is made possible by behavioral science because it has this kind of linean system of classifying and codifying different behavioral tendencies or anomalies.
Eric: So Rory, I'm interesting. I'm interested to take the conversation around behavioral science down a level and try to make it actionable for people listening. So with everything that you know you see going on, for folks listening who are maybe familiar with the term but certainly aren't the expert that you are and maybe don't yet have or don't see how they have an easy way to apply it in the work that they do and for their own careers, what's your advice for how people should get a little bit more exposed to this topic and how they should start to apply it in the work that they do?
Rory: I mean, one way is there are non-residential part-time masters programs in it, which I would generally recommend because I think one year is enough. I don't think you need to do a PhD. I don't think you need to give up work and go on a residential for two years. I think one year is enough and I don't think it's particularly difficult to grasp. It just requires you to let go of three preconceptions simultaneously, which is why people find it difficult to get into the behavioral science mindset overall. I think books are probably the answer. Read cini, read Dan. You can read my book several copies if you like but generally I think this is something where literally 10, 15 hours of study provided your prepared to loosen up and let go of existing preconceptions about how the mind works about human perception, about the idea that market research, that people can necessarily tell you what it is they want and what they're willing to pay for. As long as you start loosening up and become aware of the fact that actually value is created in the head, it's not created in the factory and therefore you can transform the value of something not by changing the thing itself, but by changing its meaning. This is very actually very William James to be honest. If you change the meaning of something, you change our emotional response, which means you change our behavior and you change its value. An example I always give, which is always strikes me a slightly weird, but I don't know what you're like on kfc. I personally like it a lot. Okay. But one thing that's always fascinated me is I've never thought about KFC the same way ever since I discovered that Colonel Saunder was 65 years old when he founded the company. Now it's utterly irrelevant <laugh> at one level, isn't it? Okay, why should my enjoyment of fried's chicken be even remotely altered by the fact that I know this guy had effectively spent a labor of love producing this 11 herbs and spices recipe and then at the age of 65 he started effectively franchising it. And so there's a lovely story there about late stage entrepreneurialism. I mean a guy, there's a wonderful thing on YouTube you've got to watch, which is where sometime in the sixties it must be the sixties because one of the panelists is actually murdered shortly after the Kennedy assassination, so it must be the early sixties. Colonel Saunders is on what's my line? And he's elderly already then. And what is utterly hysterical about colonels, it's a black and white broadcast from I guess 62, you have this guy who is probably one of the 10 most recognizable icons in the world walking on in a white suit with a boot laces tie with the specs. And there're three people trying to guess what the hell he does. Okay. But it is strange what something means our associations, our narratives, our stories, our perception basically change the whole product. We don't perceive things objectively. Evolution did not give us eyes that are light meters and ears that are recording equipment. It gave us highly interpretive sensory organs. And also the way in which we treat the incoming data from those sensory organs is extraordinarily selective and indeed distorting because it's optimized around survival, not around accuracy. And once you understand that, it becomes much, much easier to see what's going on. But you have to let go of a few cherished assumptions before you can make that shift. And that's why I probably recommend the way I got into it, to be honest, I was ill for a couple of weeks. That was the huge boost. I had really, really bad flu and I was off work for about 10 days and just got reading economics books, then behavioral economics books, then economics blogs. And that was how I discovered something. Sometime in like 2006, 2007 that nudge had come out in the US hadn't come out in the uk, I took the extravagant step of ordering it by FedEx from amazon.com. And so as a result I had one of about the first five copies in the uk, David Cameron and his advisor, Rowan Silver, were two of the other owners. And I realized, okay, I've worked in direct marketing now for getting at that stage. I suppose it, what do you mean, for about 15 years. And I thought this is the discipline I've been missing all my life. I was always convinced there was this scientific discipline or area of inquiry, which I used to call the thing for which we have no name which was effectively, it was the science of human action and decision making. And as it happened, I should have maybe if I'd Googled more actively, I would've discovered preexisting people like Herbert Simon going back to the 1940s and fifties and so on. But it was a kind of epiphany because I finally realized that I wasn't completely mad that there were other people who found this curious and wanted to know more about it.
Eric: It's fascinating and sometimes it does take that something to knock you out of your routine, to shift your perspective.
Rory: Yeah. David Ogilvy actually suggested taking a sick day. David Ogilvy actually recommended taking a day Ill a few times a year just to for the purposes of the random break. And also I think the other reason he recommended it is so you could see what people were watching on television during the day. You know, could see what it was like to live, for example, 1950s housewife existence or what life was like from nine to five when you were normally in the office. But yeah, I think just as a pandemic probably accelerated innovation in quite a few fields partly cause unusual. I think it's partly cause unusual circumstances provide permission to fail. By the way, I think it changes people's attitude to risk if you have, it's rather like necessity being the mother of invention. You have a license to fail and a license to experiment D during or after a significant collective worldwide incident that you don't have under conditions of optimal success.
Eric: We're such creatures of habit like humans just are and we like to think that we're so creative and freewheeling and we'll do whatever we want, but maybe you have the stats don't. I'm sure 99% of how we spend our time is routine. And routine is really good for delivering incremental improvement but not for exponential improvement or thinking of something new and different. And so you need to get out of the routine if you want to discover something new like that.
Rory: And the second thing thing as well as habit is social copying, which is you just go with the flow of social defaults. And so that, that's I think why there's a sigmoid curve to the abduction of new technology, which is as time goes on, more people become habituated to the new technology. But also it becomes less and less socially unusual to use it. I think the adoption of video conferencing would've happened anyway without the pandemic. I also think barring something like another pandemic or a mass transit strike I think it would've taken 10 years at least.
And by the way, we forget this, it's only old people who realize this that all technology is really slow at the beginning. Television, mobile phones, as I said, multi-channel television there is always a period of quite a few years. This is why I think video conferencing, a lot of people are talking about the metaverse and I keep going, but the Metaverse is a few years out, okay, video conferencing is here right now. The world's had a sudden crash course in how to use it. We should be reinventing our business around this technology every bit as much as retailers reinvented their business around the internet. And I do not. That does slightly annoy me when people are always obsessed with what's seven years out an awful lot of that stuff ends up going nowhere. It's So true. Anyway. True. I mean guess when we talk about behavioral science, one of the things
DuBose: I'd be intrigued to know is where do you see consumer behavior going post pandemic? We've talked a lot about innovation and the ability to ride the headwinds of the disruption of covid, but I think there is also the idea of behavioral inertia. People may go back to what they did before. Where do you see this going now?
Rory: Interesting. I'm probably going to disagree with that for the most part in the, had the pandemic lasted two weeks. Yeah, okay. And Roger Martin has written a very good thing on this. He said, everybody is saying you want staff to go back to the office as though it's the resumption. Okay, okay. Now he says after two years of a completely different habit and a completely different set of social norms, it's not what you're asking 'em to do is not to resume an old behavior. You are asking them to adopt a behavior which feels completely new. And so actually getting people to go back to the office now is really not a question of saying, Hey, you remember 2019? It's like that. You can't unlearn what you've learned over these last two years. So I don't think it is a resumption at all. I think it's actually asked, two weeks ago I went into London. I lived just outside London, just outside the M 25 in Kent. And two weeks ago I went into London for various reasons, five days in the week, all five days. And by Thursday I was going, this is fucking ridiculous, I'm not doing this again. And I sort of rang up my PA and said, I don't want any more weeks like this. It's just absolute bollocks. I can't get anything done because I'm always moving about. What it is is that of course perception is comparative and when something's normal, you've never known anything else. You keep on doing it. But now we know what the alternative feels like and that changes what going into the office feels like. Because previously what I always say is that commuting was coke and working from home was Dr. Pepper. And now in other words, it's the default social norm. You don't have to explain when you ask for a Diet Coke, do you ask for a DR diet, a diet Dr. Pepper. You've kind of got to people go. And now actually to be honest, video calling is now Coke and going into the office is a bit Dr. Pepper.
DuBose: It's a good way to think about it. Funny growing up in Alabama you say Diet Coke or Coke, and then they say what type, and then you say Dr. Pepper. So it's a bit more of the category default. Oh, oh,
Rory: No, no, you're absolutely right. Sorry. Because it's a Texan brand, isn't it, from Waco. And I noticed this in New Mexico and Texas, you basically have Coke or Dr. Pepper, you don't have Pepsi at all. And that's the same in Alabama, is it goes, goes in the other direction.
DuBose: Interesting. It's not made it that far down yet. It's going to revolutionize the state when it makes it there one day.
Rory: Fantastic. Fantastic.
Eric: So Rory, we're almost up on time. The last thing I'd like to get your thoughts on is I mentioned what we're really interesting, interested in is understanding how challenger brands grow and actually one level deeper within that why some challenger brands kind of create a bit of a buzz and some actually change the category that they're in. So maybe I can just leave it there. I'd just love to get your thoughts on mean sometimes,
Rory: By the way, the fantasy as it was to create your own category, but it's not easy to do particularly because our brains are often comparative and we can't really envisage things properly in some cases except in relation to something else.
Eric: And I think a lot of businesses that say they're creating a category aren't really, it's a bit more of the pitch because actually the job that they're doing for the customers the same and they're swapping an alternative. They might not see themselves as a competitor, but I think there's lesser true category creators out there than many challenger businesses think.
Rory: What would you give as a great example of something that genuinely and recently created a lot of buzz and noise. Obviously they're the delivery services. That's interesting. That's been a recent thing. Britain, London in particular is very good for FinTech and there have been some successes there. I mean that's a famously difficult thing to some extent. I think the hype cycle is true that in fact when things are at their noisiest is often before they've really started to deliver value at scale. Particularly that's true of network goods. You know, need to reach a certain scale of adoption before you really deliver proper value. Interesting how many entities? One thing I do notice is that when I made that observation that many of the most successful brands, in fact most of the most successful brands created over the last 20 years, didn't really make sense in advance. You could post rationalize their success, but you couldn't really rationalize it. If you imagine your way back to 1988, okay, you can't really say, you know, wouldn't really have predicted the need for Red Bull or the need for five guys or espresso or whatever, or even bottled water. Actually, if you go back to the 1970s I grew up in the Welsh borders in the 1970s and buying water in a bottle was a deeply weird thing to do. You could go to a delicates then do it, but very few people did. And so no one would've predicted those things in advance. And this is why capitalism is better seen as a discovery process than it is an efficiency optimization process. This is what I think modern economics gets wrong. It's obsessed with efficiency rather than discovery. I think there is an aspect where things that are slightly nonsensical, things that we don't expect, things that don't seem entirely logical do have the strange compensating advantage of garnering a lot of our attention. I think there was a great book by Seth Godin called Purple Cow and he essentially said you should design products with their own, what you might call their own distinctive source of attention. In other words, products which are attention generative by their very nature. And sometimes I think that means building things into the product, which a finance director or a rational software expert might find ridiculous or awful. You know, build in something that is gratuitous. What an example of that would be, the free fry, the fryers at five guys, broadly speaking, if you want people to notice you, the power to do things that your financial director hates isn't actually is probably an essential place to start. Because things that are noticeable, things that convey meaning, convey meaning precisely because they're not necessary, they're not expected, they're slightly gratuitous. And it's rather like that weird thing of gender reveal parties, which I understand was actually invented by YouTuber sometime in the presumably early two thousands. It is something I'd never heard of. And they became more and more ridiculous where they were creating forest fires because people would always have, they'd always go out into the desert and have some sort of firework to announce the gender of their child. And the next thing is that 47 square miles of California was on fire. But we instinctively know this. I think that people notice things that are politeness is actually discretionary effort. It's going above and beyond the level of effort that is necessary to be acceptably reasonable to someone. And I'm always intrigued by those things like the DoubleTree cookie and the extra scoop of fries at Five Guys and the Popsicle hotline at the Magic Castle Hotel in Los Angeles. Those things, it strikes me there's a lot more room for those kind of things.
Eric: It is, it's interesting your comments about you have to do things that your finance director dislikes. It reminds me of well duos and I actually shared this client when we were on the agency side together, but we had a client who used to say, I want to see at least one example that makes me uncomfortable in everything that you present. Because if everything's comfortable, if everybody says yes, if nobody has a problem with what you're doing, then fine, but it's probably not going to lead to something new. So I think that's an interesting nugget to continue all the food metaphors here.
Rory: Yeah, it was very funny, which people to Think about.
A colleague of mine was also at an advertising agency review session and the agencies with which they were most content with the work received the lowest scores for being easy to work with. And he actually had to turn to them and say, does it not occur to you that this may be correlated? That there's elements to necessary awkward squad in producing anything that's significantly noticeable that obtains cut through. And I think that's probably fair. And those also, as I said, an element of almost whimsical, gratuitous, bloody mindedness in that you provide something which mean, one thing that does interest me in terms of pattern recognition is if you look at five guys, who would've thought you could actually have an outlet that was more basic than a branch of McDonald's? I mean less bling refurbished than a branch of McDonald's and yet charging, getting on for 10 pounds for a burger. But they're quite clever cause the burger's really expensive and the signature milkshake is really expensive. Everything else is like free refills, free toppings extra scoop of fries for free peanuts. Everything else is quite cheap. And it occurred to me that there's a psychological insight there, which is we don't mind paying for the hero product because with the hero product we think you get what you pay for. But with the ancillary products, that's different. And my advice to anybody listening is I think if you opened a restaurant in London called Bacon Sandwich and it only sold bacon sandwiches, you might have a choice of bread, a choice of bacon. You'd also build in, by the way, a really whimsical thing. There's a thing called Thrasher, I think in let me get this right. Is there a place called Ocean City Merryland? Is that right? You're an American?
Yeah. Okay. And there are three branches of this Thrasher place, which only sells french fries and it refuses to supply ketchup. It will only give you vinegar. Okay. Now that's one of those things, and funnily enough, they were an inspiration to five guys when five guys got started and they're obsessed about where they get their potatoes from. They're obsessed about how they cook them, how they fry them. But then they have this really weird rule, which not so weird in the uk, but in the us no ketchup, no mayonnaise. You can have vinegar and you can have salt and then you can piss off. That's really extreme. I mean that's fighting torque. And once you do is you do some weird thing in bacon sandwich, which is brown sauce will be free, but you charge 50 pens for ketchup. Okay? You just do something just, just something which shows that this isn't just all about catering for the consumer. I'm doing something for love here and I have a sense of committed belief in what I'm doing, and I happen to believe that brown sauce is a natural accompaniment to a bacon sandwich, whereas ketchup is an aberration. Okay? Now a lot of people disagree, doesn't matter. And then what you do is you'd only sell two drinks, which like builders tea and champagne will be the two drinks you'd sell. Alright? Literally. And I think you can take that pattern that you isolate isolating five guys and you can't copy it, but you can make it rhyme. And I think that's where behavioral science, I think you're absolutely right, provides us with an opportunity to innovate much more effectively by spotting and codifying those kind of slightly counterintuitive aspects that somehow make something, make something stick, make something stand out. And it probably means taking one facet of something and exaggerating it quite a lot.
Eric: Well, I'm hungry now, so we've at least accomplished that. Sorry, but I think there's too much conversation. No, there's a lot of great stuff in there, Rory. Unfortunately, we are out of time, but I really appreciate, we really appreciate you taking the time to come and chat with us. If people want to find out more about you, what you're up to, your book, what's the best place for us to send them to?
Rory: What I'm doing? Actually a course we called Mad Masters, which is a 12 part course, which will kick off around about in May. Quite expensive, but worth it, I should say. Frame it right. Also, if anybody's got any kind of after sales feedback Twitter at Rory Sutherland is the perfect place to contact me
Eric: Great. We'll include both those links in the show notes. All right, Roy, we'll let you get back to your day and hopefully a bacon sandwich at some point. Yep. Thanks again for coming on.
Rory: Fantastic. Thank you, Eric. Take care, all the best.
DuBose: Thank you. Rory.
Eric: Scratch is a production of Rival. We are a marketing innovation consultancy that helps businesses develop strategies and capabilities to grow faster. If you want to learn more about us, check out we are rival.com. If you want to connect with me, email me eric@wearerival.com or find me on LinkedIn. If you enjoyed today's show, please subscribe, share with anyone you think might enjoy it, and please do leave us a review. Thanks for listening and see you next week.
